You're ecstatic. You've found a vintage handbag in a Facebook Marketplace listing, a bag you've been searching for for years. And it's only $250! The seller asks you to pay her through Venmo, and because you can see she's got a Facebook account with a photo and positive reviews, you figure she's legit and initiate the payment.
Then the package arrives a few days later. Not only is the bag not vintage, it's clearly a cheaply made fake that's damaged and not the bag you saw in the photo. The seller isn't answering your Facebook messages so you go to your financial institution and inquire how to get your $250 back. That's when you learn there's not much you can do about getting a charge reversed once you've paid through a peer-to-peer (P2P) payment service like Venmo. Here's why:
Unlike credit cards, there are no chargeback rights on P2P payment services. This means if you send someone money, even to someone who has clearly scammed you, you can't come back to your financial institution and have the charge reversed because you authorized the payment.
You never ever want to use these payment methods on goods and services that maybe you saw on Craigslist or Facebook, or even an overseas merchant that will allow you to pay with a P2P service. Seeing a payment option like this is a big red flag that should get your attention.
One of our Hanscom FCU members purchased a puppy overseas through a P2P service. She even bought flight insurance for the cute little canine she spotted in a Facebook post. The puppy never arrived at the airport. On top of not getting the puppy that had melted her heart, our member had no recourse for filing a fraud claim to get her money back. The moment she authorized those payments, her money was out of her account forever.
So next time someone asks you to send money through Venmo or another payment service, remember our #1 rule for using these services:
Use P2P services to send money only when you personally know and trust that person on the other end of the transaction.
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